India Inc raises USD 1.16 bn in July by ECBs/FCCBs
India Inc raised over USD 1.16 billion through External Commercial Borrowing and Foreign Currency Convertible Bonds during July, according to latest data from the Reserve Bank.
While USD 11,12,853,879 was raised through the automatic route under 62 projects by over 55 companies, another USD 5,17,17,228 was raised by five companies under the approval route.
Vicat Sagar Cements, a joint venture between France-based Vicat SA and Sagar Cements, raised a total of over USD 240 million in three tranches under the automatic route for a new project. The RBI, however, did not give details regarding the projects.
External commercial borrowings (ECBs) are used as an additional source of funds by Indian corporates for expansion of their existing capacity and fresh investment to augment the resources available domestically.
Corporates, registered under the Companies Act, 1956, can access ECB under the automatic route up to USD 500 million in a financial year. The ECB, which is not covered by the automatic route, is considered under the approval route on a case-by-case basis by RBI.
Foreign Currency Convertible Bonds (FCCBs) are also governed by norms similar to ECBs. HPCL Mittal Energy Ltd, the joint venture between Hindustan Petroleum Corporation Ltd and Mittal Energy Investment, raised USD 175 million under the automatic route for a new project.
Other major raisings under the automatic route were by Infrastructure Development Finance Corporation (USD 74 million for onward lending), Shiv Vani Oil and Gas Exploration Services (USD 95 million for import of capital goods) and Aurobindo Pharma (USD 50 million for overseas acquisition) and Ranbaxy Laboratories (USD 50 million for modernisation).
Under the approval route, Gujarat-based Roxul-Rockwool Insulation India raised USD 17.07 million for import of capital goods, followed by Select ARC India which raised USD 14.22 million for a new project.
